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Investing can be a confusing business. Take the London stock market for example. A lot of people talk about it being “cheap” or ignored compared to other markets.
Yet the FTSE 100, up 16% in a year and 37% across five years, has already hit an all-time high this year.
It has since fallen back slightly, but what is going on?
One market, many shares
Talking about the stock market in general can be useful in some ways. For example, it can be seen as something of a barometer for how the wider economy is performing (though at times that link is actually quite weak).
But the thing is, like most investors, I do not ‘buy the market’. Even investing in a FTSE 100 tracker fund already means getting exposure to just a fraction of the shares listed on the London market, albeit in terms of size they are substantial.
I do not even do that. Rather, I prefer to choose a diversified…
